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Peer-to-peer travel trend hits China

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L uo Zhun first travelled to the United States in 2011, visiting six cities in less than two weeks. He wasn’t very satisfied with the experience. The whole time he felt like a “caged animal,” Luo told Hangzhou Daily. Partly that was because of the language barrier. But as a member of a group tour he also felt too distant from the local culture.

“I felt very uncomfortable during the trip. It basically consisted of a large group of people eating Chinese food everywhere, spending hours on a tour bus, and going to the same spots that everyone else goes for sightseeing. When I came back, I realised I didn’t have any special memories about the trip,” he complained.

On returning to China Luo founded Shou65 (it sounds like the phrase ‘take me in’ in Chinese), a peer-to-peer (P2P) platform that connects travellers with local hosts. Its services range from renting out a spare bedroom to offering a bespoke tour around town. Tourists can post their travel plans and then search for hosts and guides, who recommend accommodation, activities and cuisine at the destinations. A rating system generates feedback for users so as to help them to select the best guides or services.

The site offers personalised options that don’t exisit on the package tour circuit. For example, local photographers offer to take pictures throughout a visit (and edit them) for Rmb60 ($9.77) a day. One guide in Tibet lures travellers by offering to take them to a hair salon to get ethnic braids, says 21CN Business Herald.

The platform has struck a chord with younger and more adventurous travellers: “I am not the type of person that does a lot of research before visiting a foreign country. But the biggest advantage of Shou65 is that you can choose what appeals to you. Nor is it very expensive so it isn’t a big burden financially. And besides, I get to meet a lot of different people,” one fan told the newspaper.

The platform has registered 100,000 customers since its launch in November 2013 and now has 11 employees, headed by Luo, who is also the founder of e-commerce site Yuanjing.

“We want to attract tourists who are tired of following the norms. Instead, they want to pursue their own individuality,” says Luo.

Shou65’s product range is cheap enough to attract backpackers, with some of the services on the site costing as little as Rmb100. Harda, another P2P travel site, offers a more upscale range, like taking tourists skiing or golfing.

Shou65 makes money by taking a 10% commission from each transaction conducted via its platform. Some travel commentators say the potential for P2P travel products is huge. For a start, Chinese tourists are travelling more than ever before. Almost 100 million trips were taken abroad last year, according to the World Tourism Organisation. Many are shunning the old-fashioned practice of going on group tours for more exotic local experiences.

Investors are paying attention too.

Wanzi Earth, a P2P travel platform that competes with Shou65, pulled in Rmb30 million in funding from a venture capitalist. Harda, too, has received over Rmb10 million from a VC firm.

China’s P2P travel services still have obstacles to overcome. In Shou65’s case, its geographical coverage is limited. Although Luo started the site after feeling shortchanged by his experience in the US, most of the cities and regions that Shou65 features are actually inside China.

Plenty of people aren’t comfortable with paying strangers online, while others opt to bypass the site once they have received the contact details of the hosts. That means that the P2P travel platforms are still working out how to deliver sustainable profits. Shou65 is wondering whether to adapt its business model from a commission-based one to selling ads instead, Luo admits.

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